Registered number:
FOR THE YEAR ENDED 30 DECEMBER 2022
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CLINITEK (MALVERN) LLP
INFORMATION
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CLINITEK (MALVERN) LLP
CONTENTS
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CLINITEK (MALVERN) LLP
MEMBERS' REPORT
FOR THE YEAR ENDED 30 DECEMBER 2022
The members present their annual report together with the audited financial statements of Clinitek (Malvern) LLP (the "LLP") for the year ended 30 December 2022.
Principal activities
The principal activity of the LLP is to finance, design, build and manage a medical waste disposal plant situated
in Malvern, for a period of 24 years from once operational, pursuant to a lease agreement dated 05 April 2019. As at the year end the plant is still under construction. The plant is currently not yet in operation and the members have taken the decision in September 2022 to place the plant in a state of temporary preservation pending a potential sale.
Designated Members
Clinitek Investor LP and Equitix V Primary Infrastructure (Clinitek) LP were designated members of the LLP throughout the period.
Members' capital and interests
Each member's subscription to the capital of the LLP is determined by their share of the profit and is repayable following retirement from the LLP.
Details of changes in members' capital in the year ended 30 December 2022 are set out in the Reconciliation of Members' Interests.
Members are remunerated from the profits of the LLP and are required to make their own provision for pensions and other benefits. Profits are allocated and divided between members after finalisation of the financial statements. Members draw a proportion of their profit shares monthly during the year in which it is made, with the balance of profits being distributed after the year, subject to the cash requirements of the business.
Going concern
The financial statements have been prepared on the going concern basis. At the year end, the LLP had a net liability position of £19,662,028 (2021: £1,713,304) and made a loss for the year of £17,948,724 (2021: £1,008,480).
As of September 2022, the plant has been placed into a state of preservation and actively advertised for sale. In February 2024, the members signed Heads of Terms with a potential acquirer to obtain the interests in the LLP (see note 12). These conditions significantly impact the LLP and as such indicate that a material uncertainty exists that may cast doubt on the LLP’s ability to operate as a going concern. The designated members have received a letter of support from its parent entities which sets out that for the period of 12 months from the signing and approval of the accounts, they will continue to provide any support necessary for the LLP to meet its day to day working capital requirements, however this is on the condition that it continues to hold an interest in the LLP. The designated members have a reasonable expectation that in the event that a sale does not happen, they have the continued support and resources to continue as a going concern for at least 12 months, or until a sale process is completed. Accordingly, the going concern basis has been adopted in the financial statements. In the event that the sale does not go ahead, the members have received a letter of support for 12 months from sign off which commits to providing any support necessary to meet day to day cash flow requirements.
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CLINITEK (MALVERN) LLP
MEMBERS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 DECEMBER 2022
Members' responsibilities statement
The members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law, (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008), requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the members must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the LLP and of the profit or loss of the LLP for that period.
In preparing these financial statements, the members are required to:
∙select suitable accounting policies and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the LLP will continue in business.
The members are responsible for keeping adequate accounting records that are sufficient to show and explain the LLP's transactions and disclose with reasonable accuracy at any time the financial position of the LLP and to enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of the Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the LLP and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Disclosure of information to auditors
Each of the persons who are members at the time when this Members' Report is approved has confirmed that:
∙so far as that member is aware, there is no relevant audit information of which the LLP's auditors are unaware, and
∙that member has taken all the steps that ought to have been taken as a member in order to be aware of any relevant audit information and to establish that the LLP's auditors are aware of that information.
This report was approved by the members on 20 March 2024 and signed on their behalf by:
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CLINITEK (MALVERN) LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK (MALVERN) LLP
We have audited the financial statements of Clinitek (Malvern) LLP (the 'LLP') for the year ended 30 December 2022, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Reconciliation of Members' Interests and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the LLP in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We draw attention to note 2.2 and note 12 of the financial statements, which set out that the plant has been placed in a state of preservation pending the potential sale of the designated members' interests in the LLP. This is sufficient evidence to indicate that a material uncertainty exists that may cast significant doubt on the LLP's ability to continue as a going concern.
However, the LLP has received a letter of support from its members and parent shareholders to continue to support the LLP up to the point that a sale occurs. Our audit opinion in not modified in respect of this matter.
In auditing the financial statements, we have concluded that the members' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the members' assessment of the LLP's ability to continue to adopt the going concern basis of accounting included the potential for the sale of the LLP post year end.
Our responsibilities and the responsibilities of the members with respect to going concern are described in the relevant sections of this report.
Except for the matter described in the material uncertainty related to going concern section, we have determined that there are no other key audit matters to be communicated in our report.
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CLINITEK (MALVERN) LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK (MALVERN) LLP (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The members are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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CLINITEK (MALVERN) LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK (MALVERN) LLP (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which the audit was considered capable of detecting irregularities including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
• the responsible individual ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; • we identified the laws and regulations applicable to the LLP through discussions with directors and other management, and from our commercial knowledge and experience of the infrastructure sector; • we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the LLP, including the Companies Act 2006 (as applied by The Limited Liability Partnerships); • we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and • we ensured that the identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the LLP's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: • making enquiries of management as to where they considered there was susceptibility to fraud and their knowledge of actual, suspected and alleged fraud; and • considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we: • performed analytical procedures to identify any unusual or unexpected relationships; and • tested journal entries to identify unusual transactions. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: • agreeing financial statement disclosures to underlying supporting documentation; • reading the minutes of meetings of those charged with governance; • enquiring of management as to actual and potential litigation and claims; • confirming the plants have the relevant permits from the Environment Agency; • held discussions with those responsible for all health and safety compliance; and • reviewing correspondence with HMRC, relevant regulators and the LLP's legal expenditure.
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CLINITEK (MALVERN) LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK (MALVERN) LLP (CONTINUED)
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.
This report is made solely to the LLP's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006, as applied by Part 12 of The Limited Liability Partnerships (Accounts and Audit) (Applications of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the LLP's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the LLP and the LLP's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants and Statutory Auditors
32 Portland Terrace
NE2 1QP
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CLINITEK (MALVERN) LLP
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 DECEMBER 2022
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CLINITEK (MALVERN) LLP
REGISTERED NUMBER: OC425697
BALANCE SHEET
AS AT 30 DECEMBER 2022
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CLINITEK (MALVERN) LLP
REGISTERED NUMBER: OC425697
BALANCE SHEET (CONTINUED)
AS AT 30 DECEMBER 2022
The financial statements were approved and authorised for issue by the members and were signed on their behalf on
The notes on pages 11 to 18 form part of these financial statements.
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CLINITEK (MALVERN) LLP
RECONCILIATION OF MEMBERS' INTERESTS
FOR THE YEAR ENDED 30 DECEMBER 2022
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
Clinitek (Malvern) LLP is a limited liability partnership (LLP number: OC425697) registered and incorporated in England and Wales. The registered office is 3rd Floor, South Building, 200 Aldersgate Street, London, EC1A 4HD.
The limited liability partnership's principal activities and nature of its operations are disclosed in the Members' Report.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006 and the requirements of the Statement of Recommended Practice "Accounting by Limited Liability Partnerships".
The financial statements are prepared in sterling, which is the functional currency of the limited liability partnership. Monetary amounts in these financial statements are rounded to the nearest £.
The following principal accounting policies have been applied:
The financial statements have been prepared on the going concern basis. At the year end, the LLP had a net liability position of £19,662,028 (2021: £1,713,304) and made a loss for the year of £17,948,724 (2021: £1,008,480).
As of September 2022, the plant has been placed into a state of preservation and actively advertised for sale. In February 2024, the members signed Heads of Terms with a potential acquirer to obtain the interests in the LLP (see note 12). These conditions significantly impact the LLP and as such indicate that a material uncertainty exists that may cast doubt on the LLP’s ability to operate as a going concern. The designated members have received a letter of support from its parent entities which sets out that for the period of 12 months from the signing and approval of the accounts, they will continue to provide any support necessary for the LLP to meet its day to day working capital requirements, however this is on the condition that it continues to hold an interest in the LLP. The designated members have a reasonable expectation that in the event that a sale does not happen, they have the continued support and resources to continue as a going concern for at least 12 months, or until a sale process is completed. Accordingly, the going concern basis has been adopted in the financial statements. In the event that the sale does not go ahead, the members have received a letter of support for 12 months from sign off which commits to providing any support necessary to meet day to day cash flow requirements.
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
2.Accounting policies (continued)
Members' participation rights are the rights of a member against the LLP that arise under the members' agreement (for example, in respect of amounts subscribed or otherwise contributed remuneration and profits).
Members' participation rights in the earnings or assets of the LLP are analysed between those that are, from the LLP's perspective, either a financial liability or equity, in accordance with section 22 of FRS 102. A member's participation rights including amounts subscribed or otherwise contributed by members, for example members' capital, are classed as liabilities unless the LLP has an unconditional right ro refuse payments to members, in which case they are classified as equity. Profits are divided only after a decision by the LLP or its representative, so the LLP has an unconditional right to refuse payment. Such profits are classed as equity rather than as liabilities. They are therefore shown as a residual amount available for discretionary division among members in arriving as the result for the year and are shown as appropriations of equity when they are allocated. Losses are allocated between the Members in their relevant proportions, restriced to the capital contributions, and shall be classified as equity rather than liabilities. The Members are not required to make additional contributions to cover any potential losses. All amounts due to members that are classified as liabilities are presented within 'Loans and other debts due to members' and, where such an amount relates to current year profits, they are recognised within 'Members' remuneration charged as an expense' in arriving at the relevant year's result. Undivided amounts that are classified as equity shows within 'Members' other interests'. Amounts recoverable from members are presented as debtors and shows as amounts due from members within members' interests
Tangible fixed assets under the cost model are stated at historical cost less any impairment loss. Cost includes professional fees and other attributable costs that are necessary to bring the asset to its operating condition.
No depreciation has been provided on the asset still under construction at the Balance Sheet date.
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
2.Accounting policies (continued)
Assets that are subject to depreciation or amortisation are assessed at each balance sheet date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows. Non-financial assets that have been previously impaired are reviewed at each balance sheet date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
2.Accounting policies (continued)
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
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CLINITEK (MALVERN) LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 DECEMBER 2022
Loans and other debts due to members may be further analysed as follows:
Loans and other debts due to members rank equally with debts due to ordinary creditors in the event of a winding up.
The immediate parent of the LLP is Equitix V Primary Infrastructure (Clinitek) LP, a limited partnership
registered in Scotland, UK. Registered address: C/O Cameron Mckenna Nabarro Olswang LLP Saltire, 20 Castle Terrace, Edinburgh, EH1 2EN. The ultimate parent company is Equitix V Primary Infrastructure LP. The members do not consider there to be one single ultimate controlling party.
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